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Is AstroNova, Inc.’s (NASDAQ:ALOT) CEO Pay Justified?

Wade Goff

In 2014 Greg Woods was appointed CEO of AstroNova, Inc. (NASDAQ:ALOT). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for AstroNova

How Does Greg Woods’s Compensation Compare With Similar Sized Companies?

According to our data, AstroNova, Inc. has a market capitalization of US$136m, and pays its CEO total annual compensation worth US$703k. (This figure is for the year to 2018). While we always look at total compensation first, we note that the salary component is less, at US$387k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO compensation in that group is US$302k.

Thus we can conclude that Greg Woods receives more in total compensation than the median of a group of companies in the same market, and of similar size to AstroNova, Inc.. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see a visual representation of the CEO compensation at AstroNova, below.

NASDAQGM:ALOT CEO Compensation January 24th 19
NASDAQGM:ALOT CEO Compensation January 24th 19

Is AstroNova, Inc. Growing?

Over the last three years AstroNova, Inc. has shrunk its earnings per share by an average of 4.0% per year. It achieved revenue growth of 24% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.

You might want to check this free visual report on analyst forecasts for future earnings.

Has AstroNova, Inc. Been A Good Investment?

AstroNova, Inc. has served shareholders reasonably well, with a total return of 32% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary…

We compared total CEO remuneration at AstroNova, Inc. with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.

Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.

And while shareholder returns have been respectable, they have hardly been superb. So you may want to delve deeper, because we don’t think the CEO pay is too low. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling AstroNova (free visualization of insider trades).

Or you might prefer this data-rich interactive visualization of historic revenue and earnings.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.